Immigrants’ startups in the U.S

According to a 2015 U.S. government report, the number of startups created by immigrants continues to outpace native-born U.S. entrepreneurs. The rate of technology startups by immigrants has increased steadily since 2010. The research found that as more immigrants are studying Science Technology Engineering and Math (STEM) than native-born, many of them are starting their company in the U.S. The report also noted that the growing number of startups have created a high number of jobs (over half million high paying jobs in the past five years.) and concluded that entrepreneurial sector is becoming more important for the economic growth.

To many Americans, immigration is a political rather than an economic topic. Many do not pay attention to the contribution of immigrants as an important source of creating jobs in the U.S. The government report found that 21 of the 87 startups valued at $1 billion or more had founders who first came to the U.S. as international students. While immigration is a major topic in the election year, but the fact is they are not looked at as a key source of job creation. When a successful startup settles in a place, it brings many benefits such as strong investment, high-paying jobs along and improving the local economy. Forty years ago, San Jose was just a small town but because many startups located there, there was enough momentum to change everything. Today the twenty square mile of San Jose or Silicon Valley is the place with the highest employment, more new jobs are created and more millionaires and billionaires living there more than any place on earth.

Startups always begin with the education systems, Silicon Valley ‘s success is due to having two of the best universities located in the area: Stanford and Berkley, where many startup ideas come from. When academic ideas turn into businesses values, they create ripple effects for many innovations and impacts the local economy. For example, on Apple’s initial public offering (IPO) over 300 millionaires were created in a single day, the most in history. Uber, the largest transportation company in the world, does not own a single car but create significant business value by a small group of software engineer. Airbnb, the largest hotel in the world also does not own a single room but control hundred thousands of rooms all over the world is started by a simple idea of a few people. While the presence of startup contributes to U.S. economy but it is only the beginning as many startups have plans to expand to another country, there will be more changes to come.

Steve Chang, a successful entrepreneur in San Jose, told the newspapers: “If you can succeed in the US, you can succeed anywhere. If you can start a successful company here, you can start almost everywhere. I want to succeed in the U.S. first, before expanding elsewhere. Every startup needs to grow by expansion, but you need money to strengthen your position before you can expand. The U.S. is the only place that has investors who are willing to fund your startup. With this money, our plan is to expand to English-speaking countries like Canada, the United Kingdom, Australia and New Zealand because our products are designed for English speaking users. If we succeed there, we will continue our expansion into other areas such as Asia, and Africa. Since every country has different rules, entrepreneurs must learn the local laws, accounting rules, business taxes, government taxes, city rules, etc. But there are countries with high risks due to bribery payments, organized crime, and other corruption so we must avoid them, else we may get into trouble.”

Satyam Krishnan is another successful entrepreneur who has taken his company to several countries explained: “There are many ways to take your company global, with various levels of complexity and investment. You need to decide between opening your sale office overseas or involving partnerships with local companies that help you to reach customers. Every country is different so the ways you use in one country may not be the same as others. For example, in Asia, the laws are not clear with many rules. You need a local company to partner with to do business and avoid problems. But in Europe, you can set up your own office and hire local people to run because their laws are clearly written and follow. The product you build in the U.S. may need a lot of modifications for different countries. You need to localize your product or service for local languages, laws, and rules, etc. Every country has a unique culture, so you also need to change your marketing accordingly to attract local people but when we expand there, more jobs will be created.”

Sources

  • Blogs of Prof. John Vu, Carnegie Mellon University

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